True Religion Enters $835-Million Merger With TowerBrook Capital Partners

5/12/2013
True Religion Apparel, Inc. has entered into a definitive merger agreement with TowerBrook Capital Partners L.P., a New York- and London-based investment management firm, in a transaction valued at approximately $835 million.

Under the terms of the merger agreement, TowerBrook will acquire all of the outstanding shares of True Religion common stock for $32 per share in cash. This represents a premium of approximately 52 percent to True Religion's share price on Oct. 9, 2012, the day before the company announced that it had begun to explore strategic alternatives. The board of directors of True Religion unanimously approved the merger agreement and recommends that True Religion shareholders vote in favor of the transaction.

Seth Johnson, lead director of True Religion, said, "After a thorough review of strategic alternatives to enhance shareholder value, we are pleased to reach this agreement, which provides our shareholders with immediate and substantial cash value representing a significant premium. The special committee has engaged in a thorough review of the state of the business, its outlook and opportunities. Having considered alternatives over a seven month period, the special committee believes TowerBrook's $32 per share cash offer for the company is in the best interest of our shareholders."

Lynne Koplin, interim CEO and president of True Religion, said, "I am pleased to announce this agreement as it offers significant value to our shareholders. TowerBrook's investment is an important endorsement of the True Religion brand, its prospects and the hard work and commitment of our team. At this critical inflection point in our business, global growth and product development effort, TowerBrook's support and experience will be a true differentiator. TowerBrook's long-term approach toward investment and brand stewardship will best enable True Religion to maintain its leadership position in the marketplace. We are confident the next chapter for True Religion will be a successful one for our employees, customers and all other stakeholders."

Andrew Rolfe, managing director of TowerBrook, said, "True Religion is an established, high-end brand with a strong retail network and a loyal following. We are excited to combine our retail and apparel expertise with Lynne and the True Religion team to help the company with brand building and international opportunities."

TowerBrook has significant experience in the consumer retail and luxury space and has made control-oriented investments in companies such as Jimmy Choo, Odlo, BevMo! and Phase Eight.

The merger is subject to approval from True Religion's shareholders, regulatory approvals and other customary closing conditions. The transaction is expected to close in the third quarter of 2013.

Guggenheim Securities, LLC is serving as financial advisor and Greenberg Traurig, LLP is serving as legal advisor to True Religion and the Special Committee of the Board. Akin Gump Strauss Hauer & Feld is legal advisor to the company. Deutsche Bank, Jefferies and its affiliates, UBS Investment Bank and Macquarie Capital have provided committed financing to TowerBrook in support of the transaction. Deutsche Bank, Jefferies and UBS Investment Bank acted as financial advisors to TowerBrook, and Wachtell, Lipton, Rosen & Katz is serving as legal advisor.
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